Sunderland boss Gus Poyet has ended speculation over his future by signing a new contract.

The Black Cats confirmed on Wednesday evening that the 46-year-old Uruguayan, who led the club to Barclays Premier League safety at the end of last season, has put pen to paper on a deal which will keep him at the Stadium of Light until 2016.

Poyet said: "I am delighted to extend my stay with Sunderland AFC after an unbelievable season and our famous great escape."

The news will come as a huge boost to both owner Ellis Short and fans on Wearside after Poyet was linked with the vacancy at Southampton following Mauricio Pochettino's departure for Tottenham.

Sources close to the club had issued a hands-off warning to the Saints as bookmakers slashed the odds on his appointment, but they have now moved decisively to tie up their head coach.

Former Brighton manager Poyet was appointed as Paolo Di Canio's successor in October last year on a two-year deal with the club bottom of the table and having claimed only a point from their first seven league games.

However, he managed not only to keep them up, but to take them to the Capital One Cup final, too, and is now planning to ensure their seemingly perennial battle against relegation becomes a thing of the past.

Poyet - whose backroom staff of Mauricio Taricco, Charlie Oatway, Andy Beasley and Antonio Pintus will remain in place - said: "Now it's a different challenge for me and the club and I am relishing the next stage with Sunderland.

"We achieved so much last season, working together - the club and the fans - and we took many good memories from the season.

"The prospect of creating more of those memories is one which excites me, and now I cannot wait for the next chapter in my career and the history of Sunderland AFC."

Poyet, Short and sporting director Lee Congerton have already held a series of talks over the way forward with the head coach raising eyebrows after suggesting that there might be something fundamentally wrong with the club.

However, those misgivings appear to have been ironed out and rebuilding work is under way with the club announcing hours earlier that out-of-contract West Brom defender Billy Jones has signed a four-year deal.

Congerton said: "We are naturally delighted that Gus has committed his long-term future to Sunderland. Our plans are well under way in terms of summer recruitment and we are working hard to bring new faces to the squad ahead of the 2014-15 season."